The Miller Act protects the payment rights of those who furnish labor or materials to federal construction projects. But what is “labor?” Does it include the on-site supervisory services of individuals who do not perform physical work? The statute is not much help in this regard as it does not define the term.
The lack of guidance on this issue at the federal appellate level is surprising, but the U.S. Court of Appeals for the District of Columbia Circuit recently joined the Eighth Circuit in addressing the matter. The court applied an expansive reading, consistent with the remedial purpose of the Miller Act.
The second case in this issue involves the enforceability of a “Liquidated Damages/Economic Disincentive” clause under Texas law. A federal appeals court had to decide if the economic disincentive provision was permissible. And if not, was the clause enforceable as liquidated damages?
The third case addresses a contractor’s responsibility for replacing work that was damaged by weather prior to completion and acceptance by the federal government. The Permits and Responsibilities clause would seem to govern the issue. The contractor, however, made multiple arguments why it should not.